One of the proposed changes in ICBC’s recent survey could cost BC drivers who have not even been involved in an accident. ICBC claims it wants to make auto insurance rates fairer, but it could result in BC drivers paying even more — especially as ICBC tries to recover from its financial crisis.
If you lend the car to your friend and they have an accident, shouldn’t they be the one who pays for it? What’s the point of premium discounts for good driving if you can get penalized for someone else’s bad driving?
The survey, which has been running this month, covers a range of issues. If the proposals in ICBC’s public engagement become official policy, one-third of ICBC-insured drivers could be facing a rate increase. If you are identified as a high-risk driver, you will start seeing rate increases of at least $100 per year during the transition.
One particular aspect that has stuck out to us in this survey concerns unlisted drivers who get in an accident. ICBC is proposing moving to a driver-based system. This could fix the current situation where accidents are attached to the vehicle, meaning vehicle owners pay higher premiums even if they weren’t involved in the accident.
This is not what ICBC is proposing, however. If a driver is at-fault for a crash, the accident would be attached to their driving portfolio for the next 10 years. If the at-fault driver was not listed as an operator then the vehicle owner would also face a penalty.
Here’s one of the questions from the survey:
Under the current system, at-fault crashes are attached to the vehicle and impact the vehicle owner’s insurance premium. The person operating the vehicle the majority of the time is declared as the principal operator. However, about 20% of crashes are caused by someone other than the principal operator; in these cases, the crash impacts only the vehicle owner, not the driver.
In a situation where a vehicle owner lends their car to a neighbour and the neighbour is involved in an at-fault crash, what should the insurance rate consequence be?
Survey takers then have the option to pick whether the owner of the vehicle or the neighbour should see an increase in their insurance risk premium.
The survey also proposes a one-time fee imposed on vehicle owners if an unlisted driver has an accident in their vehicle. Survey takers decide what an appropriate one time fee should be with options ranging between $250–$1,000.
The survey also proposes if an unlisted driver in an at-fault crash lives with the vehicle owner, the fee should be “significantly higher,” and the fee should increase if there are multiple accidents by unlisted drivers over a five-year period.
These proposals continue the problem with ICBC insurance wherein you have to pay for an accident you had no involvement in. If you lend the car to your friend and they have an accident, shouldn’t they be the one who pays for it? What’s the point of premium discounts for good driving if you can get penalized for someone else’s bad driving?
BC drivers face higher premiums for unlisted driver accidents
This is how it is under the current system: you lend your car to a friend and they get in an accident, your insurance covers the damage, but you could likely find yourself paying more to ICBC. Here’s what the ICBC says about it:
“It’s important to understand that anyone driving your vehicle is covered under your insurance. It doesn’t matter if it’s your friend, your son, or granddaughter. In the event of a crash — regardless of fault — your insurance rate and experienced-driver discount may be affected.”
It makes sense that there should be some kind of a check and balance for unlisted drivers. After all, insurance is based on risk assessment and ICBC doesn’t know to whom you are lending your vehicle. But still, why is the vehicle owner paying if they were not the ones who got in an accident? Shouldn’t it be the unlisted driver who pays? Why is the vehicle owner left to vet the driver?
The example provided is a neighbour. This is not necessarily rare. Let’s say your neighbour’s significant other is out of town and they need to run and buy groceries, you might lend them your car. But does it then become your job to vet whether or not they have a good driving record? Even if you did vet them, how confident are you that they aren’t lying?
From what we’ve seen it is more common for a friend or significant other to be driving the vehicle. Imagine you are tired or have had a few drinks, your friend might act as a designated driver and use your car to get you home safely. If they got in an accident while using your car, even though you were trying to be safe, you could still be punished by higher premiums and fees.
What happens when an unlisted driver is not honest?
What if the driver is not being honest with you? Take this case from 2006. Frank Jordison ran a commercial and private roofing company in Surrey and had two employees. Jordison stored one of his vehicles at his employee Lee Newcombe’s property because he received complaints about having four vehicles outside his house. He told ICBC he was the primary operator of the vehicle, however, Newcombe had a set of keys and Joridson admitted Newcombe did on occasion use the vehicle for work.
One day, Newcombe got in an accident while using the car for personal use without Jordison’s permission. After the accident, it was discovered Newcombe was not licensed to drive. Jordison was shocked when he learned that the driver did not have a licence and fired Newcombe.
Jordison had to fight for insurance coverage because the ICBC adjuster felt that Jordison’s status as the primary operator of the vehicle was false. The adjuster contended that Jordison and Newcombe told her Newcombe drove the vehicle the majority of the time. Since Jordison gave Newcombe the ability to use the vehicle and did not, in the judge’s view, take reasonable steps to ensure he was licensed to drive, Jordison was found liable for the damages. Here’s what the judge said:
“The undisputed fact is that in 2004 Newcombe operated the van regularly for work at a frequency of once or more per week. After work, the van was to be parked at Newcombe’s home. Jordison gave Newcombe a spare set of keys to the van. By doing so, Jordison gave de facto operative control of the vehicle to Newcombe. Newcombe admittedly drove the van more frequently and against Jordison’s instructions. He was in an accident while on a personal errand.”
Cases like this one illustrate the problem with ICBC’s plan for how they want to regulate who drives a vehicle. Vehicle owners are on the hook if anyone drives their vehicle and gets in an accident, even when that vehicle was driven under false pretences. Shouldn’t the onus be on the driver and not the vehicle owner?
ICBC survey gives BC drivers the opportunity to fight back
ICBC’s survey will be online until April 5. For one more week, BC drivers have the opportunity to voice their concerns over proposed policy changes. They also include giving a bonus to drivers who drive less than 5,000 km per year and increasing premiums on drivers with a bad driving record.
If you are a BC driver, you should absolutely fill out the survey to have your say. The proposed policies could result in you seeing a massive increase in your premiums, especially since ICBC will be trying to resolve its massive financial crisis.
You can take ICBC’s survey here.
Legal advice can help in dealing with ICBC claims
Filing a claim with ICBC is intimidating and rightly so, anything you say can be used by adjustors to justify increasing your premiums or denying your claim. If it is an unlisted driver who gets in an accident in your vehicle, you could be facing higher premiums.
ICBC regularly challenges cases where the principal operator is not the one who got in an accident — they can argue you breached your contract. That’s why it can help to talk to a lawyer first. Legal advice can help you understand your rights when dealing with filing an ICBC claim. At Acumen Law Corporation, our lawyers have fought for BC drivers against ICBC many times.
If you need to file a claim, call us for a free consultation.